Alert for Stock market Investors

Hello friends 

Did you realize that a one-lakh rupee investment in Nifty last year would today be worth Rs 99,000? That's precise.

The latest sell-off in global shares has shattered all of Nifty's year-to-date gains.

Despite a minor improvement in May, retail inflation remains significantly above the Reserve Bank of India's (RBI) tolerance ceiling of 6%.

A twin whammy of rising commodity prices, particularly for oil, and a record-low Rupee has only exacerbated the situation.

Experts believe that the RBI would raise interest rates even higher to keep inflation under control, which would be a tremendous disadvantage.

The United States is facing the same issue but on a much larger scale!

The short-term US 2-year Treasury yield surpassed 3% for the first time since the Global Financial Crisis of 2007.

Rising short-term rates reflect sour long-term market sentiment, implying that investors are losing faith in the US market's prospects. This is a traditional indication of a recession.

So, what's next?

I feel that as markets adjust to the "new" normal, the next 6-12 months will be extremely difficult.

For the remainder of 2022, I don't see any upside in the Nifty from current levels, in my opinion.

Wealth generation opportunities may be limited to a few industries.

Defensives, utilities, consumer staples, and automobiles are among my decent picks. Following the current slump, I am selectively optimistic about IT equities as well.

It's crucial to remember, though, that the market tries to price equities based on their future ability to generate value, not on their past price swings.

The fact that the current inflation data were worse than predicted was a major factor in the stock market's massive sell-off.

When the market is confronted with significant negative surprises, it tends to discount assets to reflect the increased risk and/or lower expected future returns.

As a result, how many more unpleasant surprises we have ahead of us determine whether the market will crash again soon.

With so much uncertainty around the market and the near-term future, it's easy to become paralyzed and do nothing at all.

While sticking to the course is usually a good approach for participating in any recovery that occurs after a crash, you must have the proper financial foundation in place to do so.

As a result, now is an excellent time to examine your financial foundation and do what you can to strengthen it.

That way, you'll be in a better position to profit if the market crashes again whenever that may be.

On the other hand, even if the market does not fall again during your investment career, having a sound financial foundation in place can provide you with considerable peace of mind even in times of normal market volatility

Wise investing 

growth with learning 

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